Most pairs are stuck in ranges over the past few hours as market participants are waiting to see how geopolitical risks pan out.
Fresh Market Headlines & Economic Data:
- Australia AIG job advertisements down by 6.7% in Dec
- Japanese final December services PMI at 49.4
- Chinese senior agricultural official Han Jun: China will not increase annual imports of U.S. farm goods
- Japanese finance minister Aso: Seeing clear signs that global economy is slowing
Upcoming Potential Catalysts on the Forex Calendar:
- Swiss CPI due 8:30 am GMT
- U.K. housing equity withdrawal at 10:30 am GMT
- Euro zone flash headline and core CPI at 11:00 am GMT
- Euro zone retail sales at 11:00 am GMT
What to Watch: USD/CAD
This pair has been stuck inside a range, with support around 1.2960 and resistance at 1.3000. Price is currently testing support and could be due for a bounce back to the top.
Stochastic is already pulling up from the oversold region, signaling that buyers are defending the floor.
There’s not much in the way of top-tier releases in the upcoming session, which suggests that majors could stay stuck in ranges for much longer. As it is, traders seem to be holding out of larger plays while waiting to see how the situation between the U.S. and Iran pans out.
Looking at the pair’s average daily volatility suggests that it could have room to hit the top of the range if you attempt to catch this bounce off support.
A pickup in risk-taking throughout the session could spur a downside break, and a target of roughly 40-50 pips that’s the same size of the range would also fit in the average USD/CAD volatility.